Why Investors Need to Take Advantage of These 2 Construction Stocks Now

Two factors often determine stock prices in the long run: earnings and interest rates. Investors can't control the latter, but they can focus on a company's earnings results every quarter.The earnings figure itself is key, of course, but a beat or miss on the bottom line can sometimes be just as, if not more, important. Therefore, investors should consider paying close attention to these earnings surprises, as a big beat can help a stock climb and vice versa.Hunting for 'earnings whispers' or companies poised to beat their quarterly earnings estimates is a somewhat common practice. But that doesn't make it easy. One way that has been proven to work is by using the Zacks Earnings ESP tool.The Zacks Earnings ESP, ExplainedThe Zacks Earnings ESP, or Expected Surprise Prediction, aims to find earnings surprises by focusing on the most recent analyst revisions. The basic premise is that if an analyst reevaluates their earnings estimate ahead of an earnings release, it means they likely have new information that could possibly be more accurate.Now that we understand the basic idea, let's look at how the Expected Surprise Prediction works. The ESP is calculated by comparing the Most Accurate Estimate to the Zacks Consensus Estimate, with the percentage difference between the two giving us the Zacks ESP figure.In fact, when we combined a Zacks Rank #3 (Hold) or better and a positive Earnings ESP, stocks produced a positive surprise 70% of the time. Perhaps most importantly, using these parameters has helped produce 28.3% annual returns on average, according to our 10 year backtest.Stocks with a #3 (Hold) ranking, which is most stocks covered at 60%, are expected to perform in-line with the broader market. But stocks that fall into the #2 (Buy) and #1 (Strong Buy) ranking, or the top 15% and top 5% of stocks, respectively, should outperform the market. Strong Buy stocks should outperform more than any other rank.Should You Consider Sterling Infrastructure?The final step today is to look at a stock that meets our ESP qualifications. Sterling Infrastructure (STRL) earns a #3 (Hold) 11 days from its next quarterly earnings release on February 24, 2025, and its Most Accurate Estimate comes in at $1.38 a share.Sterling Infrastructure's Earnings ESP sits at +2.99%, which, as explained above, is calculated by taking the percentage difference between the $1.38 Most Accurate Estimate and the Zacks Consensus Estimate of $1.34. STRL is also part of a large group of stocks that boast a positive ESP. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.STRL is one of just a large database of Construction stocks with positive ESPs. Another solid-looking stock is Dycom Industries (DY).Slated to report earnings on February 26, 2025, Dycom Industries holds a #2 (Buy) ranking on the Zacks Rank, and it's Most Accurate Estimate is $0.95 a share 13 days from its next quarterly update.The Zacks Consensus Estimate for Dycom Industries is $0.91, and when you take the percentage difference between that number and its Most Accurate Estimate, you get the Earnings ESP figure of +4.97%.Because both stocks hold a positive Earnings ESP, STRL and DY could potentially post earnings beats in their next reports.Find Stocks to Buy or Sell Before They're ReportedUse the Zacks Earnings ESP Filter to turn up stocks with the highest probability of positively, or negatively, surprising to buy or sell before they're reported for profitable earnings season trading. Check it out here >>Should You Invest in Sterling Infrastructure, Inc. (STRL)?Before you invest in Sterling Infrastructure, Inc. (STRL), want to know the best stocks to buy for the next 30 days? Check out Zacks Investment Research for our free report on the 7 best stocks to buy.Zacks Investment Research has been committed to providing investors with tools and independent research since 1978. For more than a quarter century, the Zacks Rank stock-rating system has more than doubled the S&P 500 with an average gain of +24.08% per year. (These returns cover a period from January 1, 1988 through May 6, 2024.)Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Sterling Infrastructure, Inc. (STRL): Free Stock Analysis Report Dycom Industries, Inc. (DY): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks